This peculiar word belongs to the lexicon of l33t sp34k (leet speak), which gained usage among gamers, h4x0rs and other on-line denizens. I encountered it a few times and thought it looked like some bizarre form of pseudo-Welsh, so I found out what it meant. Its origins were so weird and so hotly contended that I felt like it deserved a little more research and a node.

For those unfamiliar, (as I was a few months ago) with the whole leet language phenomenon, there are some verygoodnodes about it. Leet language is essentially a confusing collection of typos and alphanumeric characters which stand in for other words or characters. It is meant to be used by 'elite' (leet) online types. This form of communication was created for two purposes: first, it is always kind of fun to have a specialized language for one’s pastime (however irritating it may be to outsiders), and secondly, people engaging in questionable activities could sneak around word-filters and such traps designed to home in on specific words and phrases.

Experienced users could use heavily 'leeted' language around inexperienced users (n00bz), which would act as a sort of hazing for the new users. Some individuals who are interested in such things feel that pwnt is not genuinely 'leet' enough to be classed as leetspeak, as only words with numerals and ASCII characters really qualify. By this theory, pwnt goes into a sort of gamer and chatroom dialect, along with abbreviations as OMG and BRB. I leave the reader to decide on the relative absurdity of the preceding thought.

This word owes its origin to the English word own. In the jargon of players, to own someone is to defeat them thoroughly. There is some precedent for this, "I have you," or "you are mine" are common enough ways for sports players (among others) to express "I am about to defeat you." Also, it is not particularly rare to hear of someone "owning" a match.

At this point, the story becomes unclear and the linguistic historians among the online types disagree. Many (probably most) people feel that pwned (it became shortened to pwnt only later, as we will see below) was a common typographic error, that is, people meaning to type "I owned you" would often type "I pwned you." This typo was common enough to take its place in the lexicon of online speak (kalen remembers seeing it as far back as the 80s). It can not be argued that typos have, on occasion, made their way into this jargon, take 'teh' for example. This funny misspelling of the word 'the' is so common that it actually has made its way from the online universe to the outside world, usually as a self-conscious reference to the speaker’s actual lack of hipness (not that your humble author would know anything about attempted self-deprecating humour).

Another school of thought holds that pwned (or pwn3d) is a synthetic word, self-consciously created from the obvious owned and another word before it. Problem is, no one can agree on what word that letter p came from—pure, player, porn (or pr0n in leet speak—the idea being that it is as good or better than porn—ahem, pr0n), power (powerfully) or personally. I have to say, I like 'porn owned,' but the typo certainly seems like the most likely explanation to me.

It has come to my attention that the P may have represented a mouth with a tongue sticking out, as in the emoticon :P —this meaning was popular with the battle.net crowd. Whether this was the absolute original reason for the letter P or not, I have to say, it is probably the funniest reason for the letter to be there! (thanks to Yaldabaoth, who apparently used to play way too much Diablo2 on b.net!)

With the word Pwned thus in place, the gamers took the word a step further, mutating it into a (presumably humourous) past tense— ownt, probably from such similar English words as burnt and spelt. The variant ownt exists in some quarters, likely as a result of parallel or retro-evolution, but it does not enjoy the sort of wide usage that this word does.

W is sounded like a u, making this word an exact homophone of the English word punt.

The w takes on the sound of 'ou' as in shout. Thus 'pount.'

The w takes a u sound, but a very soft one like the 'ou' in could. This one has a lot of favor (and I like it, if I have to pick one), but it suffers from being a little awkward to pronounce for many English-speakers. A better-sounding compromise is 'pwint,' which is probably what I will use when I refer to this word! (thanks to Bitriot for that one).

Of course, there are exceptions to the three above vowel sounds. I have heard cases made for 'o' as in bone, 'ai' as in paint.

Some feel that, as a typo, pwnt should be pronounced exactly as ownt, that is, just like don't without the d (or, in some cases, exactly like owned). Still another school of thought holds that gamer-speak is to be typed, not spoken. By this reckoning, there is no proper way to pronounce pwnt, as it is never intended to be spoken.

As the use of the word pwnt has spread, the clever lads and lasses of the online gamer community have spindled, mutilated and morphed it into about a hundred various usages (you probably think I'm exaggerating, don't you?). So, whether you are a pwnz0r, frequently putting the pwntdown on others, or you are pwnt by life; whether you are a pwntagonist, frequently performing pwntacular feats, or if you yourself have been Al Capwned* and end up ka-pwnt or stealthily WTFpwned; you can say that you know the meaning of pwnt, even if you can't say for sure what the origin or pronunciation are.

A word of caution: If you do choose to incorporate this word into your vocabulary, do so sparingly. Otherwise, people are liable to take you for one of those types who overuse such jargon and call you a pwntard—then they may make sure you are Pwnt ITF WAP (Pwnt In The Face With A Pinecone).

* Or the exceptionally funny Stallown3d!!! Still laughing about that one, thanks to Myrkabah

References:
Thanks to The Custodian for help with the timing of the evolution of this word!
and nicnic for further insight into its evolution
Urban Dictionary online at: http://www.urbandictionary.com/define.php?term=pwnt
Fragmentary writeup on Wikipedia
Even more perplexing fragments on various far-flung corners of the web
Conversations with a few people who are more savvy in the script kiddie culture than I am (which is not hard!)